* SSEC -0.7%, CSI300 -1.0%, HSI -0.3%
* HK->Shanghai Connect daily quota used 0.4%, Shanghai->HK daily quota used 3%
* FTSE China A50 -0.7%
SHANGHAI, Aug 9 (Reuters) - China stocks reversed earlier gains to fall on Friday, posting their biggest weekly decline since early May, as weak factory data and lingering trade worries weighed.
** The blue-chip CSI300 index fell 1.0%, to 3,633.53, while the Shanghai Composite Index slid 0.7% to 2,774.75.
** For the week, CSI300 was down 3%, while SSEC shed 3.2%, both logging their steepest weekly declines in three months.
** China’s factory gate prices shrank for the first time in three years in July, stoking deflation worries and putting pressure on Beijing to deliver more stimulus as the economy sputters amid an intensifying trade war with the United States.
** “Weak demand has started to impact expectations on the production side,” analyst Zou Qiang at Everbright Pramerica Fund Management said in a note.
** Zou expects the price contraction to worsen in the coming months due to stricter curbs on the property sector, as regulators try to rein in debt risks and tame rising home prices.
** There were also lingering worries over the Sino-U.S. trade war.
** Some leading China-listed firms, including the country’s No.2 telecom equipment maker ZTE tumbled amid worries over a U.S. ban.
** That pushed the index tracking major telecoms index on the mainland lower by 2.5%.
** The U.S. agency responsible for government contracts on Wednesday released an interim rule for a ban on federal purchases of telecommunications equipment from five Chinese companies, including Huawei and ZTE.
** The tech slump also came after a report from Bloomberg that Washington is delaying a decision about licenses for U.S. firms to restart trade with Huawei Technologies.
** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.21%, while Japan’s Nikkei index closed up 0.44%.
** At 07:14 GMT, the yuan was quoted at 7.0505 per U.S. dollar, 0.07% weaker than the previous close of 7.0455.
** The biggest percentage gainers in the main Shanghai Composite index were Ningbo United Group Co Ltd, up 10.07%, followed by Chengtun Mining Group Co Ltd, gaining 10.06% and Autobio Diagnostics Co Ltd, up by 10%.
** The biggest percentage losers in the Shanghai index were Guangdong Hotata Technology Group Co Ltd down 10.02%, followed by Anzheng Fashion Group Co Ltd losing 9.97% and Angel Yeast Co Ltd down by 9.85%.
** So far this year, the Shanghai stock index is up 11.3% and the CSI300 has risen 20.7%.
** As of 07:15 GMT, China’s A-shares were trading at a premium of 29.74% over the Hong Kong-listed H-shares. (Reporting by Shanghai Newsroom; Editing by Shounak Dasgupta)